Where did the traffic of Viya and Xue Li go?

1.341 billion yuan is the amount of money that the live-streaming e-commerce queen Viya was fined for tax evasion.

This astronomical data means that a person with a monthly salary of 10,000 yuan after tax would need to work day and night for 11,175 years. It is also the net profit level that exceeds that of 4,165 A-share listed companies in Shenzhen and Shanghai in 2020. Of course, it is also the 0.95 yuan that each of us can get on average.

Before Viya, two anchors, Xue Li (Zhu Chenhui) and Lin Shanshan, had evaded personal income tax of 30.3695 million yuan and 13.1194 million yuan between 2019 and 2020. They were required by regulators to recover taxes, charge late payment fees, and were fined 1 times the amount, 65.5521 million yuan and 27.6725 million yuan respectively.

1. The rise and fall of Wei Ya and Xue Li, a story of a brave man turning into a dragon

Here, looking back at the rise and fall of Viya and Xue Li, it is not difficult to find that this is actually another story of "the brave man turning into a dragon".

To be fair, the existence of anchors like Wei Ya and Xue Li did help consumers solve the problem of choosing their favorite products among a vast number of commodities in the early stage. At the same time, during the severe period of the epidemic, it also helped many businesses to quickly reach consumers, solve inventory problems, and even overcome survival difficulties.

However, as the anchors, especially the top anchors, have gained more and more influence, they have gradually turned live streaming with goods into a game of "bringing traffic to attract brands and users."

Many brands are angry but dare not speak out. What is even more ironic is that there are countless small and medium-sized businesses that simply cannot afford the slot fees of these super anchors. The repeated quality problems of the products they promote have also made consumers increasingly "confidence-fatigued."

Overall, the reality in the entire live broadcast ecosystem is that only big anchors such as Viya and Xue Li are making a lot of money, while small anchors, merchants and consumers have never really enjoyed this feast.

Data from the "2020 China Online Performance (Live Broadcasting) Industry Development Report" shows that currently most domestic anchors have a monthly income of around 3,000-5,000 yuan, and the amount of tax evasion and fines imposed on Wei Ya alone reached 1.341 billion yuan.

In comparison, the huge gap is self-evident.

It can be said that the towering trees in the live streaming craze such as Viya and Xue Li not only failed to shelter the small trees and grass from wind and rain, but instead monopolized the sunshine and rain that originally belonged to the small trees and grass.

This is obviously unhealthy for an ecosystem.

2. The industry has reached a turning point, and the rise of private e-commerce is inevitable

When an industry gradually grows from a booming industry to one where only a very small number of people benefit, it means that the industry has reached a turning point.

As the saying goes, a duck knows first when the river water warms in spring. An insider from Whale Ling Group, a leader in the private domain e-commerce SaaS field, revealed that since the live broadcast rooms of Viya and Xue Li were blocked, there have been many more brands and merchants coming to discuss settlement recently than before, and they all want to establish their own private domains. As a leading domestic private domain SaaS service provider that has accumulated more than 20,000 brands through the S2B2C model, achieved daily sales of millions of SKUs, and empowered 3 million small Bs, the industry trends announced by Whale Ling Group can obviously serve as an industry weather vane.

In fact, according to industry data, since the live broadcast rooms of Viya and Xue Li were blocked, traffic has begun to flow back to small and medium-sized businesses, driving their store traffic and transaction volume to increase significantly in recent times. In order to take over this escaped traffic, small and medium-sized brands have also seized the opportunity to build private domain traffic.

All these things reveal the following trend: the era of relying on the live broadcast rooms of big anchors to seek brand exposure is fading away, and the era of building one's own stable and controllable private domain traffic is accelerating.

From a realistic perspective, the fall of Viya and Xue Li is actually just a catalyst for the accelerated rise of private domain e-commerce. In fact, the rise of private domain e-commerce is inevitable.

1. From the perspective of industry scale and growth rate, private domain e-commerce already has a large enough market scale and its growth rate is much higher than that of the B2C market.

According to the data from the "Rise of Private Domain E-commerce 2021 Private Domain Traffic White Paper": In 2020, the GMV of mini program e-commerce was 800 billion yuan, the overall transaction volume increased by 100% year-on-year, and the per capita transaction amount increased by 67%. In the past two years, the growth rate of the private domain market has reached 160% and 100% respectively. In 2021, the entire market size of private domain e-commerce may exceed 3 trillion yuan. In contrast, although the B2C market is larger, its growth rate is less than 30%. In contrast, it is obvious that the balance of opportunities has tilted significantly towards private domain e-commerce.

2. From the perspective of operational needs, private domain e-commerce can better tap into the total value of user life cycle.

In the reality that traffic has bottomed out, customer acquisition costs have increased, and user loyalty is difficult to build, it is inevitable to achieve refined user operations and deeply explore the total life cycle value (LTV) of users. What is required here is to improve user retention and repurchase. However, in the past, brands relied on top anchors to bring products, but in fact, they could only achieve user reach, which could only bring a short-term increase in transaction volume for the brands, but could not bring user retention and repurchase rate to the brands.

In the reality that users only recognize the anchors and not the brands, in order to achieve user repurchase, the brand can only continue to cooperate with the anchors, which naturally makes it easy for the anchors to take away the product pricing power. In fact, this has already happened in the previous L'Oreal incident. And if we take into account the costs of slot fees, commissions, special research and development, and preliminary preparation fees, the overall picture is that most of the time, the input and output of brands in live streaming are not proportional, and they are losing money to gain publicity.

In contrast, the advantage of private domain e-commerce lies in that it can firmly grasp the traffic and users in its own hands, and with the help of relevant private domain solutions, it can establish a behavioral portrait of all parties involved, making operations and decision-making more accurate and supply and demand more matched, thereby achieving industrial chain optimization and improved monetization efficiency, and achieving increased user retention and repurchase.

Taking the S2B2C solution of Whale Ling Group as an example, it effectively enables brands to achieve user retention and increase repurchase rates by clearly profiling and positioning the behaviors of all parties involved in the entire business process (brands themselves, KOCs and users). For example, a women's clothing brand, with the help of its solution, carried out in-depth operations and product customization, and achieved a 3-fold increase in single-fan revenue, jumping from 0.2 to 0.6.

3. From the perspective of customer acquisition costs, private domain e-commerce has more customer acquisition cost advantages.

The high cost of acquiring customers in the public domain has become a pain point in the industry, and the cost of acquiring customers in the entire public domain market has been rising again and again. According to the data released by Wu Xiaobo in the "Charm of Cycles New Year's Eve Speech": In the third quarter of 20201, among Internet e-commerce platforms, Alibaba's customer acquisition cost was 673 yuan/person; Pinduoduo was 578 yuan/person; JD.com was 384 yuan/person.

Such high customer acquisition costs are not only a heavy burden for large companies, but also make it difficult for small and medium-sized brands to cope.

Under this reality, activating private domain traffic has in fact long been an inevitable means to reduce customer acquisition costs. After all, according to relevant data, the cost of acquiring customers in the private domain is only about 100 yuan. In comparison, the cost advantage of customer acquisition is significant.

3. Private domain operations may be the last ticket for brands to move towards the future

According to the "2021 New Consumer Brand Private Domain Marketing Report" released by Guanchao Research Institute, new consumer brands have increased their investment in private domain marketing, and the overall penetration rate of WeChat private domain has reached 80%.

It can be said that making good use of private domain traffic and private domain SaaS tools to achieve an explosion in brand sales has become a consensus in the industry. Not to mention the new brands that have rapidly emerged in recent years, such as Perfect Diary, Yuanqi Forest, and Huaxizi, all of them have relied on the refined operation of private domain traffic to achieve user sedimentation, deep grass-planting conversion and sales explosion.

In fact, many brands have achieved sales leaps and brand growth with the help of private domain SaaS tools.

With the help of the Whale Ling Super CRM+ solution, which integrates AI big data product selection, group product matching, material AI, customer service AI, logistics AI, after-sales AI, RPA shopping guide and other technical empowerments, and relying on the Whale Ling S2B2C model, the high-end snack brand Bestore achieved a GMV of over 30 million during the Whale Ling platform's Double 12 Carnival event; Novan's first-day sales exceeded 10.8 million; the time-honored Chinese brand Hengyuanxiang's GMV exceeded 7 million within 5 hours of going online on the Whale Ling Super Product Day event; the women's clothing brand VICTORIA&VERA on the Whale Ling platform surged 50% after the Viya incident, with its single-day GMV reaching 1.2 million.

Other related successful cases include a large number of brands such as Xingyou, Fenteng, Seranger, Be & Cheery, China Gold, Zhong Xue Gao, Hongxing Erke, and Renben.

In the reality that these brands are daring to take risks in the private e-commerce market, making good use of empowering tools and achieving market success, in fact, for those brands that are still hesitant and confused about private e-commerce, the only option left may be to rush into the market. After all, for the vast majority of brands, after missing out on the B2C market, there are not many tickets left for the future.

4. Final Thoughts

Judging from various realities, the rise of private-domain e-commerce is inevitable, and the downfall of Viya and Sydney due to tax evasion may objectively accelerate this process - after all, small and medium-sized brands hope to be able to take over the hundreds of millions of fans who have fled from their live broadcast rooms and to realize refined operations.

From the perspective of the general trend of the times, it is not difficult to find that compared to live streaming e-commerce, which only a very small number of people can enjoy the feast of capital and traffic, private domain e-commerce that relies more on "KOC and amateurs to help brands reach and convert users in a low-cost, efficient and continuous manner" is relatively more in line with the melody of common prosperity.

After all, countless mothers, physical store owners, WeChat merchants, community group buying leaders, office workers, etc. will have the possibility of earning extra income due to the rise of private domain e-commerce. For example, there are currently 3 million small Bs who have earned an income by selling goods on Whale Ling, and some excellent KOCs can earn 3,000-5,000 yuan or even more than 10,000 yuan per month on the platform.

It is also obvious here that it is far more meaningful to allow millions of people to have an extra income every month than to allow a very small number of people to make a fortune every day.

Author: Neighbor Chapter

Source: TMT317